$80 a month is little consolation for fraud victim

That is the proverbial sound of reimbursement being made to the 100 or so local victims of a far-reaching Ponzi scheme perpetrated in the 1990s by the late Water J. Rozanski of Auburn and his son, Christopher J. Rozanski.

For the past two years, Edward M. Foss of Shrewsbury has been receiving monthly checks from U.S. District Court in Newark, N.J., for the precise amount of $80.43. Christopher Rozanski’s name is listed in the notes. That adds up to $965.16 per year, approximately $1,930 over two years. Mr. Foss said he received some less-regular $40 checks before the $80 checks started coming every month.

But Mr. Foss and his wife are owed $200,000 that they invested with Walter Rozanski in 1993. At a reimbursement rate of just under $1,000 per year, they won’t receive a full refund — give or take a decade — for 205 years.

Mr. Foss is 74 years old. The Fosses will be dead before they get their money back.

Mr. Foss called me recently, hoping that another set of eyes might find some other money associated with the Rozanskis.

“I think there’s an account in the Cayman Islands somewhere, but I can’t prove it,” he said.

Like many of the victims of the Rozanski father and son, Edward and Joan Foss are working-class people who trusted Walter Rozanski with their savings. They were taken in by Walter’s smooth talk, along with his promises of 14 percent return on their investment, which might have been the first warning sign the deal was too good to be true.

First, some background.

Mr. Rozanski was a Worcester-based accountant who, according to news articles in the Telegram & Gazette, had an outsized personality to match his 500-pound frame. His Franklin Street accounting firm appeared successful. He had a nice home in Auburn, a summer home on the Cape, drove nice vehicles, vacationed often. He served as chairman of the Auburn School Committee, and was known to be affable and generous.

In 1993, Mr. Foss and his wife received a financial windfall from the sale of some land that she inherited from her family. They invested $200,000 with Mr. Rozanski, “who had come very highly recommended,” Mr. Foss said. They were promised 14 percent return on their investment, delivered monthly. The money was supposed to be invested in a large shopping development in Philadelphia, he said.

Mr. Rozanski told his victims that if they ever wanted their money back to just ask, and 10 days later it would be returned.

The couple received a few interest checks, but in October 1993, Mr. Rozanski died of a heart attack at age 48.

A month later, dozens — and then hundreds — of local investors started asking where their money went. The Fosses were among them.

Walter’s son, Christopher Rozanski, was later charged with perpetuating the Ponzi scheme started by his father.

In 1998, Christopher Rozanski pled guilty to 23 counts of mail and bank fraud, filing false income tax returns, conspiracy, money laundering and perjury. He was sentenced to 33 months in federal prison, and ordered to pay $2.5 million in restitution to the victims of the scheme.

Although the case did not go to trial, federal prosecutors were prepared to prove that Mr. Rozanski “worked to cover up his part in his father’s scheme by filing false income tax returns and forging his father’s name on checks, which were backdated to make it appear as if they were made out before his death,” according to a 1998 article in the Telegram & Gazette.

The federal prosecutor also said government agents and victims of the Rozanskis’ fraud were prepared to testify that the younger Rozanski participated in check-kiting and money-laundering schemes initiated by his father, signed promissory notes given to clients in return for their money and deposited checks given to him by investors in his own and his father’s accounts.

According to court records, Mr. Rozanski served his prison time and subsequent probation.

Living in New Jersey, he is now employed as vice president of customer service at Delphi Technology Inc., according to his LinkedIn profile. The company provides technology solutions to insurance and risk management companies.

Federal court records indicate that since 2008 Mr. Rozanski’s paychecks from Delphi have been garnished, with the money being sent back in the form of restitution to the hundreds of victims of his and his father’s fraud. He was earning approximately $118,000 per year at Delphi in 2008, according to court records.

There’s nothing left in Walter Rozanski’s estate. It was liquidated for about $159,000, according to probate court records, and the last payout was made in 2003.

For the Fosses, that means all that’s left of their $200,000 is 80 bucks a month taken from Chris Rozanski’s paycheck.

“Well, it doesn’t help much, but it’s better than nothing,” Mr. Foss said. “I was hoping for a pot of gold somewhere. I guess this will have to do.”